"There is only one power that determines the course of history . . . the power of ideas." — Ayn Rand

Saturday, January 16, 2016

The NJ Star-Ledger Peddles the Fossil Fuel Subsidy Myth

It's time to walk the talk on climate change, urged the New Jersey Star-Ledger back in June 2015. After repeating the mantra of catastrophic climate change, for which there is no evidence but plenty of failed predictions—which grow more shrill with each failed prediction of impending apocalypse—the Star-Ledger chastised Western governments for failing to back up pledges to scale back fossil fuel burning, especially coal, with much “concrete action.”

The Star-Ledger observes that “Without question, fossil fuels delivered great benefits to humankind in the past century,” but that the time is fast approaching when the catastrophic climate effects of continued fossil fuel burning will far outweigh the benefits.

The G7 reached “an agreement to decarbonize the global economy by the end of this century,” the Star-Ledger observes, but lambasted five of the seven nations —Germany, Japan, England, France, and Italy—for not only failing to live up to prior such agreements, but actually going in the opposite direction, having “burned more coal, the largest source of global warming gases, since the 2009 Copenhagen Summit.”

The Star-Ledger then turned its criticism toward the United States. “U.S. taxpayers,” bemoans the Star-Ledger, “subsidize Big Oil with roughly $37.5 billion annually instead of committing more to renewables.” But on examination, those subsidies are a myth.

As evident in the very report the Star-Ledger itself links to, those Big Oil “subsidies” are not subsidies at all. These alleged “subsidies” consist of:

tax provisions which allow oil exploration and production companies to keep more of their own earnings. An actual subsidy involves taking money out of some people’s pckets anf handing it out to others.

royalty fees that oil and gas companies must pay the government for access to “public” (government controlled) lands, which themselves are maintained by taxpayers, a group that includes the oil industry itself.

infrastructure support, which is also funded in part by oil industry taxes.

Military protection of American oil company interests abroad, also funded in part by oil industry taxes.

The passing on of pollution control costs to “the public,” as if consumers who pay for and benefit from fossil fuel energy should not pay the costs of cleaning up the pollution their own buying choices cause.

The biggest actual subsidy—properly defined as money seized from one taxpayer and funneled into the pocket of another—is not even a subsidy to the oil companies. Rather they are fuel purchase handouts to poor energy consumers.

There may be a few real subsidies to the fossil fuel industry, but they pale next to actual subsidies to “renewable” energy, which, after decades and tens of $billions in corporate welfare, still can’t deliver reliable, economical, base-load energy. This is why Germany, Japan, England, France, and Italy are burning more coal, and newly industrializing countries are choosing fossil fuels, mostly coal, over “renewables.” Average people in these countries are not willing to give up the massively life-enhancing benefits of fossil fuels so as to avoid the comparatively miniscule (and increasingly technologically fixable) pollution side effects, or heretofore minor climate effects, of fossils. The monumentally positive tradeoff favoring fossils over climate concerns is a no-brainer. The real danger to human well-being comes not from climate “deniers,” but fossil benefit deniers.

As to the impending climate catastrophe, there is no evidence of that. The only catastrophe evident is that contained in perpetually-wrong model predictions.

The same is true with claims of “100-percent feasible” “renewable” energy, which exist in predictions but not in fact. If “The technology and resources exist to begin the transition” to 100% “renewable”, non-carbon energy, then no subsidies would be needed. Only a free market is needed. The only reason fossil fuel’s dogmatic enemies want to transform fossil fuel non-subsidies into actual subsidies for “renewables” is because, as a primary energy source, “renewables” are crap. If they weren’t crap, they wouldn’t need subsidies and government policies like carbon taxes to prove themselves. If “renewables” really are that good, they will have no problem doing to fossil fuels what digital photography did to film photography king Eastman Kodak; what innovative communications technology did to the AT&T monopoly; what the personal computer did to mainframe computer king IBM; and what electrification did to John D. Rockefeller’s near-total dominance of kerosene-based nighttime illumination more than a century ago. Until that day comes, if it comes, stop demonizing and hampering the fossil fuel industry and its customers.

Fossil fuel energy doesn’t need subsidies. The industry is immensely profitable on its own, which is why oil companies are the nation’s biggest taxpayers both in absolute dollar and percentage terms. Whatever actual subsidies the fossil fuel industry receives, it pales in comparison to the $289 billion in taxes paid by just the 3 largest oil companies, ExxonMobil, Chevron, and ConocoPhillips, over the last 5 years—the most among all companies.

True, “Without question, fossil fuels delivered great benefits to humankind in the past century”—and continue to deliver human life enhancing benefits around the globe in a way that “renewables” have never been able to do. It’s time to stop the war on fossil fuels, lest a real climate crisis befalls man, which lack of reliable energy would surely deliver.

Related Reading:

Turning a Subsidy into ‘Payment for a Value Delivered’: Corporate Welfare for NJ Solar Companies [12/10/15]

About Me

Greetings and welcome to my blog. My name is Michael A. (Mike) LaFerrara. I sometimes use the pen or "screen" name "Mike Zemack" or "Zemack" in online activism, such as posted comments on articles. “Zemack” stands for the first letters of the names of my six grandchildren. I was born in 1949 in New Jersey, U.S.A., where I retired from a career in the plumbing, building controls, and construction industries, and still reside with my wife of 45 years. The purpose of my blog is the discussion of a wide range of topics relating to human events from the perspective of Objectivism, the philosophy of reason, rational self-interest, and Americanism originated by Ayn Rand.

As Rand observed: “The professional intellectual is the field agent of the army whose commander-in-chief is the philosopher.” I am certainly not the philosopher. But neither am I a field agent, or general. I am a foot soldier in that Objectivist army that fights for an individualist society in which every person can live in dignified sovereignty, by his own reasoned judgment, for his own sake, in that state of peaceful coexistence with his fellow man that only capitalist political and economic freedom can provide. While I am a fully committed Objectivist, my opinions are based on my own understanding of Objectivism, and should not be taken as definitive “Objectivist positions.” For the full story of my journey toward Objectivism, see my Introduction.

One final introductory note: I strongly recommend Philosophy, Who Needs it, which highlights the inescapable importance of philosophy in every individual's life. I can be reached at mal.atlas@comcast.net. Thanks, Mike LaFerrara.

Recommended Essays/Videos

Quotes I Like

Let me give you a tip on a clue to men’s characters: the man who damns money has obtained it dishonorably; the man who respects it has earned it. Run for your life from any man who tells you that money is evil. That sentence is the leper’s bell of an approaching looter.—Francisco d'Anconia

I love getting older...I get to grow up and learn things. Madalyn, 5 years old, Montesorri student, and my grand-daughter

The best thing one can do for the poor is to not become one of them. Author Unknown

Nature, to be commanded, must be obeyed. Francis Bacon

Freedom is never more than one generation away from extinction. Ronald Reagan

Thinking is hard work. If it weren't, more people would do it. Henry Ford

Intellectual freedom cannot exist without political freedom; political freedom cannot exist without economic freedom; a free mind and a free market are corollaries. Ayn Rand